newjerseynewsroom.com

Indiana and Rhode Island toymakers must pay state $269,300

A state appeal court has upheld an earlier decision in favor of the state Division of Consumer Affairs’ separate lawsuits against an Indiana company and another in Rhode Island that together sold nearly 14,000 yo-yo waterballs to New Jersey consumers despite a 2008 state law banning the dangerous toys.

Consumer Affairs filed suit in June 2009 against Indiana Novelty International Inc., which does business as Kipp Brothers and which sold 444 yo-yo waterballs in New Jersey after the ban on the toys took effect. In December 2009 the division sued Rhode Island Novelty Inc., also known as RINCO, which sold 13,344 yo-yo waterballs in New Jersey after the ban was in place.

The court ruled against both companies in the separate cases. Indiana Novelty was ordered in August 2010 to pay $54,300 in civil penalties, plus reimbursement to the state for $13,000 in attorneys’ fees and investigative costs. Rhode Island Novelty was ordered in December 2010 to pay $190,000 in civil penalties plus reimbursement to the state for $12,000 in fees and costs.

On Wednesday, it was learned the court upheld both decisions, ruling the companies’ appeals were without merit. The companies did not dispute their sales of the potentially dangerous toys after they were banned, but argued that the penalties imposed were excessive; and that Consumer Affairs erred in failing to allow a “grace period” before enforcing the Yo-Yo Waterballs Act.

The court noted in each decision that the penalties imposed were lower than the maximum penalty allowed by the Yo-Yo Waterballs Act, of $10,000 for the first offense and $20,000 for each subsequent offense. Regarding the companies’ argument that there should have been a “grace period,” the court noted that the law became law on Jan. 3, 2008, but did not become effective until the following April 1, and that Consumer Affairs was not obligated to notify every potential seller of yo-yo waterballs before enforcing the ban.

“We are talking about toys that have been known to wrap around the throats of young children, causing strangulation,” Consumer Affairs Director Thomas R. Calcagni said. “Anyone who sees a banned yo-yo waterball offered in New Jersey for sale, as a prize, or as a gift should contact us immediately. Businesses can promote children’s safety simply by following the law and not selling these dangerous toys in New Jersey.”